Singapore-based Sinochem International and Halcyon Agri Corp. have agreed to merge and form the world's largest natural rubber supply chain manager, Halcyon Agri said Monday, with combined revenues of more than $2.3 billion. The businesses will be combined under Halcyon Agri, which will continue to be listed on the SGX.

In the upstream segment, the combined business would have 153,000 ha of land in Africa and South East Asia. In the midstream processing segment, the combined business would have 35 processing facilities spanning Indonesia, Thailand, Malaysia, China and Africa with a total annual processing capacity of approximately 1.5 million tonnes. The global distribution strength of the combined business would be unparalleled, with an extensive distribution network centred around key hubs in China, Asia, Europe and the United States and annual natural rubber and latex sales capability in excess of 2 million tonnes.

Sinochem International will acquire a 30.07% shareholding in Halcyon Agri for S$0.75 cents per share in cash and make a mandatory general offer (MGO) to all shareholders of Halcyon Agri at the same price. Certain shareholders of Halcyon Agri have also provided undertakings such that Sinochem International’s shareholding in Halcyon Agri following completion of the MGO will be no less than 53.98%.

Finally, Halcyon Agri will also acquire Sinochem’s natural rubber processing assets in China and Malaysia and trading businesses, for consideration of 280 million Halcyon Shares.

Following completion of the transactions, Sinochem will be the majority shareholder of Halcyon Agri, which will be the holding company of the expanded group.

The transactions are subject to, among others, the approval of Halcyon Agri shareholders at an extraordinary general meeting and regulatory and competition approvals in certain jurisdictions. Final completion of the transactions is expected by the end of Q3 2016.